Building Approvals is a notoriously volatile monthly series and we have no strong predisposition for September’s reading, out Thursday.

Solid underlying population demand points to activity remaining high; we look for a 1.1% gain in September, some modest growth also hinted at by the AiG PCI Construction Index.

ANZ:

We think building approvals increased by 0.7% m/m in September. It is likely that we have already seen most of the declines in approvals from the earlier peak.

Strong housing finance approvals and solid confidence in the sector mean that approvals and construction activity should stabilise around these still-elevated levels.

Westpac:

Dwelling approvals rose 0.4% in Aug, essentially holding steady after an 11% jump back in June. The detail showed high rise approvals continuing to pull back sharply but offset by a strong lift in non-high rise approvals.

We expect the support from non-high rise segments to drop away this month. After showing solid gains in previous months, construction-related housing finance approvals — a reasonable proxy for non high rise approvals — pulled back sharply in Aug-Sep. While there is invariably some slippage between finance and dwelling approvals, the non-high rise segment is unlikely to see continued strong gains. With high rise still winding down we expect total approvals to fall 3% in the Sep month.